The Bangko Sentral ng Pilipinas (BSP) will share four prudential bank reports with the Philippine Deposit Insurance Corp. (PDIC) as part of the new and revised information sharing of bank reports with PDIC for the earlier detection of any threats to the financial system.
In a memo (Memorandum No. M-2024-033), signed by BSP Deputy Governor Chuchi G. Fonacier last Oct. 21, she said the financial and non-financial reports submitted by banks to the BSP will be “shared with the PDIC consistent with the provisions” of what they had agreed upon previously. She was referring to the revised and updated memorandum agreement (MOA) signed last Feb. 8 between BSP and PDIC.
The prudential reports subject to the information exchange with the PDIC are: solo Financial Reporting Package (FRP) as of quarter-end reference period to be submitted quarterly by universal and commercial banks, Islamic banks, digital banks, thrift banks, rural banks and cooperatives banks; solo risk- based capital adequacy ratio report and control prooflist; solo liquidity report and control prooflist; and the recovery plan of banks known as domestic systematically important banks or D-SIBs and non D-SIBS, including subsidiary banks of D-SIBs as solo and group-wide which will be submitted annually.
“In sharing the above information, the Bangko Sentral shall ensure that the Bangko Sentral and PDIC adhere to the basic data privacy principles of transparency, legitimate purpose, and proportionality,” said Fonacier.
Last February, the BSP and the PDIC through a revised MOA on information exchange agreed on the sharing and exchange of bank submitted reports and certain other reports, data and information as may be agreed upon by both.
The information sharing is expected to improve the effectiveness of both BSP and PDIC operations and is consistent with the provisions of Section 10 (d) of Republic Act No. 3591 or the PDIC Charter, as amended, which state that “the Bangko Sentral shall share to the PDIC its reports of examination on banks, and such other reports or information as may be agreed upon, provided that the use of such reports or information are in accordance with the terms and conditions agreed upon by the PDIC and the Bangko Sentral and prescribed by applicable laws and regulations.”
PDIC President and CEO Roberto B. Tan, former National Treasurer and finance undersecretary, emphasized earlier on the importance of maintaining transparent communication between the BSP and the deposit insurer at all times.
More transparency “provides opportunities for a comprehensive understanding of potential risks, enabling us to draw up preemptive measures, detect challenges early, and promptly intervene to immediately address problems among banks to make it responsive to the changing times,” he said.
The enhanced collaboration will also enable both institutions to “protect the depositing public, especially from frauds and scams that have become even more elaborate and complex,” added Tan.
The revised MOA amends the previous Nov. 12, 2002 agreement as well as the supplemental MOA executed in 2004.
According to the BSP, since all MOA documents have been updated, it will operate as an Omnibus Agreement covering all information, data, and reports shared between the BSP and the PDIC as per their respective mandates.
Some key features of the updated MOA include: seamless information sharing through digital platforms and rationalized processes; leveraging the BSP Electronic Information System for the timely, secure, and efficient sharing of reports, data, and information between the two agencies; and the periodic review and update of the MOA to consider evolving supervisory requirements.
As the state deposit insurer, the PDIC protects depositors by providing deposit insurance up to the maximum deposit insurance coverage of P500,000 per depositor, per bank.
In 2022, the PDIC Charter was amended and took effect on July 20 of the same year.
The new law transferred PDIC to the BSP as an attached agency from the Department of Finance. This was done to improve policy and program coordination as banking co-regulator.